Trendwatch
Deal Trends May 2008
May 9, 2008
Atlanta
Biggest Lease
The Federal Aviation Administration expanded to 100,000 SF in a long-term lease at a build-to-suit project at Tradeport, an office and industrial park adjacent to Hartsfield-Jackson Atlanta International Airport. The landlord, Highwoods Properties Inc., expects to deliver the office building during the first quarter of 2009. Class A rental rates in the South Atlanta submarket average $24.54 PSF, according to Colliers Spectrum Cauble.
Biggest Sale
No major sales were reported.
Biggest Development
Industrial Developments International Inc. began site work on the $120M, 2.8 MSF Jefferson Distribution Center at Interstate 85 and Georgia Highway 82 in Jackson County. The developer plans to put up five buildings on the 225-acre parcel. The first, a 1 MSF distribution facility, is scheduled to break ground during the third quarter of 2008 and deliver by summer 2009.
Boston
BIGGEST LEASE
Law firm Burns & Levinson L.L.P. leased 103,052 SF at 125 Summer St., a 464,000-SF Class A office tower across the street from South Station. The renewal includes a 14,000-SF expansion. Ronald Perry, Francis Durand, John Carroll and Lawrence Epstein of Colliers Meredith & Grew represented the tenant. Andrew Hoar of CB Richard Ellis-New England represented the landlord, Equity Office, and Andrew Maher and Ryan Enright also represented Equity Office internally. Class A asking rents in the Financial District average $62 PSF.
BIGGEST SALE
No major sales were reported.
BIGGEST DEVELOPMENT
A joint venture of Gale International L.L.C. and Vornado Realty Trust is completing demolition work at the future site of One Franklin St., a $600M redevelopment of the historic Filene’s department store building in the Downtown Crossing district. Plans for the 38-story tower call for 600,000 SF of office space, a 250-key hotel and space for the Filene’s Basement store, which will re-open early next year. Completion of the entire project is expected in 2011.
Chicago
Biggest Lease
Trane Inc., a provider of energy-efficient heating, ventilation and air conditioning systems, renewed its 50,157-square-foot lease of 7100 Madison St. in Willowbrook, Ill. Hugh Williams of Cushman & Wakefield Inc. represented the tenant, and Julie Mertins of Prime Group Realty Trust represented the landlord.
Biggest Sale
RREEF sold the 1.4 MSF office tower at One North Wacker Drive to U.S. Core Office Fund L.P., a subsidiary of Hines, for $540M, or $385 PSF. The 51-story tower is 98 percent leased. Eastdil Secured L.L.C. represented the seller, and Hines was represented internally.
Biggest Development
No major developments were reported.
Dallas
Biggest Lease
Equastone signed a 10-year lease for 99,000 SF of office space at the Children’s Medical Center Dallas at Stemmons. Josh White, Carl Ewert and Brad Seiner of The Staubach Co. represented landlord. Reid Caldwell, Kim Butler and Linda Simpson of Transwestern represented the tenant. Lease rates in the area average $15 PSF.
Biggest Sale
Granite Properties acquired Spectrum Center, a two-building, 598,000-SF office complex in Addison, for $80M. Andrew Levy and Todd Savage of Holliday Fenoglio Fowler L.P. represented the seller, Crescent Spectrum Center L.P. Paul Bennett represented the buyer internally.
Biggest Development
Tanger Factory Outlet Centers Inc. announced that it will build an upscale shopping center at the site of Texas Stadium in Irving, which the National Football League’s Dallas Cowboys will vacate at the end of the 2008-2009 football season. The open-air shopping center will feature 90 stores in a racetrack layout with both covered and uncovered walkways.
Houston
Biggest Lease
No major leases were reported.
Biggest Sale
A joint venture of Post Investment Group and Hudson Realty Capital acquired Broadway Square, a 2,469-unit apartment complex, for $62M from the estate of Harold Farb. Craig LaFollette, Todd Stewart, Todd Marix and Tre Banks of CB Richard Ellis Inc. represented the seller. Jack Ehrman represented Post Investment Group internally.
Biggest Development
Transwestern has begun work on Eldridge Oaks, a 700,000-SF office development in the Energy Corridor. The 14-story, 350,000-SF tower is scheduled for a September completion.
Los Angeles
Biggest Lease
ODW Logistics Inc. leased 339,980 SF of industrial space in AllianceCalifornia, a logistics center in San Bernardino. Al Leon of Leon Brothers represented the tenant. Peter McWilliams, Ruben Goodsell and Michael McCrary of Colliers International represented the landlord, Hillwood Investment Properties. Lease rates in the area average $4.60 PSF.
Biggest Sale
Douglas Emmett Inc. acquired 8383 Wilshire Blvd., a 426,000-SF office building in Beverly Hills, from Arden Realty Inc. for $178.3M. Eastdil Secured L.L.C. represented the seller.
Biggest Development
The Westlake Village City Council has approved plans for Opus West Corp.’s $180M, 435,000-SF Opus Corporate Center, which will include office and retail components. The project is slated to break ground in May and to deliver during the first quarter of 2009.
New York City
BIGGEST LEASE
General Motors Corp. leased 120,000 SF in 153 E. 53rd St., a 1.6 MSF office tower in Midtown Manhattan. The company plans to relocate from 767 Fifth Ave. next year. Peter Riguardi, Michael Shenot, Lloyd Desatnick and Michael Stafford of Jones Lang LaSalle Inc. represented the tenant, and Frank Doyle, Cynthia Wassberger and David Kleine of Jones Lang LaSalle represented the owner, Boston Properties Inc. Area asking rents exceed $100 PSF.
BIGGEST SALE
In a $680M deal, a joint venture of Ashkenazy Acquisition Corp. and The Carlyle Group acquired 650 Madison Ave., a 600,000-SF Midtown Manhattan office tower. Law firms Kriss & Feuerstein L.L.P. and Greenberg Traurig L.L.P. represented the venture, and Eastdil Secured L.L.C. advised the buyers. JPMorgan Chase & Co. represented the seller, Hiro Real Estate Co.
BIGGEST DEVELOPMENT
The New York City Council approved developer Sheldon Solow’s $4B proposal to redevelop a Manhattan parcel south of the United Nations building. He plans to put up a 1 MSF office building and 3,000 apartment units across six towers.
San Francisco
Biggest Lease
FedEx Ground has signed a long-term, 320,875-SF lease for 8333 Central Ave. in Newark. The deal includes 6.2 acres for truck storage. The combined effective rate is $0.605 triple-net PSF per month. Colliers International represented the landlord, LBA Realty. Fischer & Co. represented the tenant.
Biggest Sale
UDR Inc. purchased the 193-unit Edgewater Apartments community at 355 Berry St. from Urban Housing Group, a subsidiary of The Marcus & Millichap Co., for $115M. The 157,203-SF, six-story property features one- and two-bedroom units, loft units, a business center and conference room with Internet access and a parking garage. Marcus & Millichap Real Estate Investment Services Inc. represented both the buyer and the seller.
Biggest Development
No major developments were reported.
South Florida
Biggest Lease
Bilzin Sumberg Baena Price & Axelrod L.L.P. inked a 10-year, 115,000-SF lease in the first tower of the 1.5 MSF Brickell Financial Centre rising at 680 Brickell Ave. in Miami. Barbara Liberatore Black and Matthew Goodman of CresaPartners L.L.C. represented the tenant. Danet Linares represented the landlord, Foram Group Inc., internally. John Kuhn of Bilzin Sumberg advised the tenant internally, and Janis Cheezem of Akerman Senterfitt advised the landlord. Rental rates in the tower average $46 PSF, according to Black's Guide.
Biggest Sale
Fontainebleau Resorts L.L.C. sold 50 percent of its interest in the Fontainebleau Miami Beach resort at 4441 Collins Ave. to Nakheel Hotels for $375M. The two owners plan to continue a $500M renovation of the property, which will feature 1,500 guest rooms, 200,000 SF of meeting and event space, a 40,000-SF spa, restaurants and a nightclub upon its expected opening later this year.
Biggest Development
Stiles Construction Co. broke ground on the nation's largest Lexus dealership, a 1 MSF, 9-acre complex at 14100 Biscayne Blvd. in North Miami, for Craig Zinn Automotive Group.
Washington, D.C.
Biggest Lease
Harris Teeter inked a 20-year, 50,000-SF lease in the upcoming Constitution Square project at First and M streets. Cary Judd and Melissa Lower Welch of KLNB Retail represented the tenant. The landlords, StonebridgeCarras and Walton Street Capital L.L.C. were represented internally. Triple-net rental rates for grocery stores in Washington, D.C. average $28 PSF, according to Cushman & Wakefield Inc.
Biggest Sale
In its D.C. debut, Vico Capital acquired the 206,000-SF 2099 Pennsylvania Ave. for $173M. John Kevill and Collins Ege of Jones Lang LaSalle Inc. represented the seller, Wealth Capital Investments. Tenants include Holland & Knight L.L.P., Perseus L.L.C. and Danaher Corp.
Biggest Development
StonebridgeCarras and Walton Street Capital L.L.C. broke ground on the 1.6 MSF Phase I of Constitution Square at First and M streets. Plans for the phase, scheduled to deliver in 2010, include 929,000 SF of Class A office space across two buildings, a 80,000 SF of retail space, a 440-unit apartment building and a 204-key Hilton Garden Inn hotel.
Atlanta
Biggest Lease
The Federal Aviation Administration expanded to 100,000 SF in a long-term lease at a build-to-suit project at Tradeport, an office and industrial park adjacent to Hartsfield-Jackson Atlanta International Airport. The landlord, Highwoods Properties Inc., expects to deliver the office building during the first quarter of 2009. Class A rental rates in the South Atlanta submarket average $24.54 PSF, according to Colliers Spectrum Cauble.
Biggest Sale
No major sales were reported.
Biggest Development
Industrial Developments International Inc. began site work on the $120M, 2.8 MSF Jefferson Distribution Center at Interstate 85 and Georgia Highway 82 in Jackson County. The developer plans to put up five buildings on the 225-acre parcel. The first, a 1 MSF distribution facility, is scheduled to break ground during the third quarter of 2008 and deliver by summer 2009.
Boston
BIGGEST LEASE
Law firm Burns & Levinson L.L.P. leased 103,052 SF at 125 Summer St., a 464,000-SF Class A office tower across the street from South Station. The renewal includes a 14,000-SF expansion. Ronald Perry, Francis Durand, John Carroll and Lawrence Epstein of Colliers Meredith & Grew represented the tenant. Andrew Hoar of CB Richard Ellis-New England represented the landlord, Equity Office, and Andrew Maher and Ryan Enright also represented Equity Office internally. Class A asking rents in the Financial District average $62 PSF.
BIGGEST SALE
No major sales were reported.
BIGGEST DEVELOPMENT
A joint venture of Gale International L.L.C. and Vornado Realty Trust is completing demolition work at the future site of One Franklin St., a $600M redevelopment of the historic Filene’s department store building in the Downtown Crossing district. Plans for the 38-story tower call for 600,000 SF of office space, a 250-key hotel and space for the Filene’s Basement store, which will re-open early next year. Completion of the entire project is expected in 2011.
Chicago
Biggest Lease
Trane Inc., a provider of energy-efficient heating, ventilation and air conditioning systems, renewed its 50,157-square-foot lease of 7100 Madison St. in Willowbrook, Ill. Hugh Williams of Cushman & Wakefield Inc. represented the tenant, and Julie Mertins of Prime Group Realty Trust represented the landlord.
Biggest Sale
RREEF sold the 1.4 MSF office tower at One North Wacker Drive to U.S. Core Office Fund L.P., a subsidiary of Hines, for $540M, or $385 PSF. The 51-story tower is 98 percent leased. Eastdil Secured L.L.C. represented the seller, and Hines was represented internally.
Biggest Development
No major developments were reported.
Dallas
Biggest Lease
Equastone signed a 10-year lease for 99,000 SF of office space at the Children’s Medical Center Dallas at Stemmons. Josh White, Carl Ewert and Brad Seiner of The Staubach Co. represented landlord. Reid Caldwell, Kim Butler and Linda Simpson of Transwestern represented the tenant. Lease rates in the area average $15 PSF.
Biggest Sale
Granite Properties acquired Spectrum Center, a two-building, 598,000-SF office complex in Addison, for $80M. Andrew Levy and Todd Savage of Holliday Fenoglio Fowler L.P. represented the seller, Crescent Spectrum Center L.P. Paul Bennett represented the buyer internally.
Biggest Development
Tanger Factory Outlet Centers Inc. announced that it will build an upscale shopping center at the site of Texas Stadium in Irving, which the National Football League’s Dallas Cowboys will vacate at the end of the 2008-2009 football season. The open-air shopping center will feature 90 stores in a racetrack layout with both covered and uncovered walkways.
Houston
Biggest Lease
No major leases were reported.
Biggest Sale
A joint venture of Post Investment Group and Hudson Realty Capital acquired Broadway Square, a 2,469-unit apartment complex, for $62M from the estate of Harold Farb. Craig LaFollette, Todd Stewart, Todd Marix and Tre Banks of CB Richard Ellis Inc. represented the seller. Jack Ehrman represented Post Investment Group internally.
Biggest Development
Transwestern has begun work on Eldridge Oaks, a 700,000-SF office development in the Energy Corridor. The 14-story, 350,000-SF tower is scheduled for a September completion.
Los Angeles
Biggest Lease
ODW Logistics Inc. leased 339,980 SF of industrial space in AllianceCalifornia, a logistics center in San Bernardino. Al Leon of Leon Brothers represented the tenant. Peter McWilliams, Ruben Goodsell and Michael McCrary of Colliers International represented the landlord, Hillwood Investment Properties. Lease rates in the area average $4.60 PSF.
Biggest Sale
Douglas Emmett Inc. acquired 8383 Wilshire Blvd., a 426,000-SF office building in Beverly Hills, from Arden Realty Inc. for $178.3M. Eastdil Secured L.L.C. represented the seller.
Biggest Development
The Westlake Village City Council has approved plans for Opus West Corp.’s $180M, 435,000-SF Opus Corporate Center, which will include office and retail components. The project is slated to break ground in May and to deliver during the first quarter of 2009.
New York City
BIGGEST LEASE
General Motors Corp. leased 120,000 SF in 153 E. 53rd St., a 1.6 MSF office tower in Midtown Manhattan. The company plans to relocate from 767 Fifth Ave. next year. Peter Riguardi, Michael Shenot, Lloyd Desatnick and Michael Stafford of Jones Lang LaSalle Inc. represented the tenant, and Frank Doyle, Cynthia Wassberger and David Kleine of Jones Lang LaSalle represented the owner, Boston Properties Inc. Area asking rents exceed $100 PSF.
BIGGEST SALE
In a $680M deal, a joint venture of Ashkenazy Acquisition Corp. and The Carlyle Group acquired 650 Madison Ave., a 600,000-SF Midtown Manhattan office tower. Law firms Kriss & Feuerstein L.L.P. and Greenberg Traurig L.L.P. represented the venture, and Eastdil Secured L.L.C. advised the buyers. JPMorgan Chase & Co. represented the seller, Hiro Real Estate Co.
BIGGEST DEVELOPMENT
The New York City Council approved developer Sheldon Solow’s $4B proposal to redevelop a Manhattan parcel south of the United Nations building. He plans to put up a 1 MSF office building and 3,000 apartment units across six towers.
San Francisco
Biggest Lease
FedEx Ground has signed a long-term, 320,875-SF lease for 8333 Central Ave. in Newark. The deal includes 6.2 acres for truck storage. The combined effective rate is $0.605 triple-net PSF per month. Colliers International represented the landlord, LBA Realty. Fischer & Co. represented the tenant.
Biggest Sale
UDR Inc. purchased the 193-unit Edgewater Apartments community at 355 Berry St. from Urban Housing Group, a subsidiary of The Marcus & Millichap Co., for $115M. The 157,203-SF, six-story property features one- and two-bedroom units, loft units, a business center and conference room with Internet access and a parking garage. Marcus & Millichap Real Estate Investment Services Inc. represented both the buyer and the seller.
Biggest Development
No major developments were reported.
South Florida
Biggest Lease
Bilzin Sumberg Baena Price & Axelrod L.L.P. inked a 10-year, 115,000-SF lease in the first tower of the 1.5 MSF Brickell Financial Centre rising at 680 Brickell Ave. in Miami. Barbara Liberatore Black and Matthew Goodman of CresaPartners L.L.C. represented the tenant. Danet Linares represented the landlord, Foram Group Inc., internally. John Kuhn of Bilzin Sumberg advised the tenant internally, and Janis Cheezem of Akerman Senterfitt advised the landlord. Rental rates in the tower average $46 PSF, according to Black's Guide.
Biggest Sale
Fontainebleau Resorts L.L.C. sold 50 percent of its interest in the Fontainebleau Miami Beach resort at 4441 Collins Ave. to Nakheel Hotels for $375M. The two owners plan to continue a $500M renovation of the property, which will feature 1,500 guest rooms, 200,000 SF of meeting and event space, a 40,000-SF spa, restaurants and a nightclub upon its expected opening later this year.
Biggest Development
Stiles Construction Co. broke ground on the nation's largest Lexus dealership, a 1 MSF, 9-acre complex at 14100 Biscayne Blvd. in North Miami, for Craig Zinn Automotive Group.
Washington, D.C.
Biggest Lease
Harris Teeter inked a 20-year, 50,000-SF lease in the upcoming Constitution Square project at First and M streets. Cary Judd and Melissa Lower Welch of KLNB Retail represented the tenant. The landlords, StonebridgeCarras and Walton Street Capital L.L.C. were represented internally. Triple-net rental rates for grocery stores in Washington, D.C. average $28 PSF, according to Cushman & Wakefield Inc.
Biggest Sale
In its D.C. debut, Vico Capital acquired the 206,000-SF 2099 Pennsylvania Ave. for $173M. John Kevill and Collins Ege of Jones Lang LaSalle Inc. represented the seller, Wealth Capital Investments. Tenants include Holland & Knight L.L.P., Perseus L.L.C. and Danaher Corp.
Biggest Development
StonebridgeCarras and Walton Street Capital L.L.C. broke ground on the 1.6 MSF Phase I of Constitution Square at First and M streets. Plans for the phase, scheduled to deliver in 2010, include 929,000 SF of Class A office space across two buildings, a 80,000 SF of retail space, a 440-unit apartment building and a 204-key Hilton Garden Inn hotel.
